FIMI acquiring 50% of SOS Energy

Ishay Davidi  photo; Tamar Matsafi

FIMI will pay NIS 90 million to owner Tomer Levy for the stake in the on-site fueling company. 

FIMI Opportunity Funds is investing in SOS Energy Express, a company owned by Tomer Levy. SOS Energy, founded by Levy in 2002, specializes in on-site fueling and fueling under special conditions.

SOS Energy's revenue totaled NIS 320 million in 2016, and the company sales are projected to reach NIS 540 million this year (sales of 100 million liters of diesel and other fuel). Operating profit is expected to total NIS 30 million. The company has 130 employees.

FIMI will invest NIS 90 million for 50% of the shares in SOS Energy, reflecting a NIS 180 million value for the company (an EBITDA multiple of 6). The exact amount of the investment will depend on milestones for SOS Energy in the coming years.

In contrast to other fueling companies, which market fuel at fixed filling stations (in addition to sales of other items at convenience stores), SOS Energy has a different model based on providing special on-site services.

SOS Energy's main customers are infrastructure companies; SOS primarily fuels their field engineering equipment. The company also operates in construction (projects in Harish, Modi'in, Rosh HaAyin, and other cities), industry, home heating, and fueling services for government entities, including the IDF, Israel Police, and Israel Fire and Rescue Services. SOS Energy's services are a substitute for fuel storage equipment stationed on the site by the contractor or infrastructure company, which must either transport heavy equipment for fueling or keep large amounts of fuel on site.

SOS Energy has grown substantially over the past three years, after obtaining a fuel manufacturer's license in 2014, and now operates 80 tankers. Growth of over 10% is projected in 2017.

Levy said, "SOS has grown significantly in recent years, and we believe that the company's great potential will be realized through FIMI's investment and cooperation." Levy will continue as company CEO, together with SOS Energy's other senior executives.

This is FIMI's second energy investment over the past 12 months; a year ago, it invested NIS 100 million in Delek San Recycling Ltd., controlled by Sano-Bruno Enterprises Ltd. (TASE: SANO1), Meir Shani, and entrepreneur Eran Shalev.

FIMI acquired control of Delek San Recycling through preferred shares, and will own 39-100% of the company, depending on Delek San Recycling's performance in the coming years (the better Delek San Recycling's performance, the less FIMI will own).

Delek San Recycling recycles chemical waste from industry, and develops technology that helps preserve the environment. The company deals with environmental solutions, mainly the treatment of industrial wastewater with a high ratio of chemicals. Its solutions prevent the burning and landfill of industrial waste through the use of refining processes that make it possible to recycle and reuse these materials.

Founded by CEO Ishay Davidi in 1996, FIMI administers $3.2 billion in capital, making it Israel's largest investment fund.

FIMI has acquired control of 85 companies to date, and has sold off 55 of them in deal with an aggregate value of $4.5 billion. The fund invests in export-oriented Israeli companies having widespread international business.

Published by Globes [online], Israel Business News - www.globes-online.com - on October 1, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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Ishay Davidi  photo; Tamar Matsafi
Ishay Davidi photo; Tamar Matsafi
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